CitiReport Looks at SF Ethics, 2011-2013

When CitiReport relaunched in January 2011 it was with the intent of providing information and commentary on the workings of City Hall and in particular the junction of ethics, money and politics.

Over the past two years, our attention has returned repeatedly to the city’s Ethics Commission, the current city laws and how they are or are not enforced. The links below to some of our articles over the past two years are not all encompassing, but provide additional context for the Board’s consideration of a new reform effort by City Attorney Dennis Herrera and Board President David Chiu.

CitiReport’s efforts have drawn on the knowledge and skills of many people, some of whom then authored posts we presented on CitiReport. They include Oliver Luby, Adriel Hampton, George Wooding among others in links below. We also have had the benefit of analysis and in-depth reporting by Marc Salomon, Patrick Monette Shaw, among others.

“While we have a hard-working Ethics Commission and San Franciscans have repeatedly voted for ethics reform, we need to do more to be sure laws are enforced, and to close loopholes that cause the public to question our transparency. Together, we can do better.”

While San Franciscans can count themselves lucky to have better disclosure laws and mechanisms for timely provision of public data than most other jurisdictions, the structure that is in place is full of holes. These holes in disclosure are studied by election attorneys and often find usage in the bags of tricks plied by campaign consultants. Money flows through them like water finding its way through cracks in a ceiling. The end game of what San Francisco has now is a system that provides too little disclosure too late, permits obfuscation of the true sources behind public communications, and is too complicated to be easily used by most of us, including the press.

The Board of Supervisors proponent argument in the 1993 Voter Guide: “We recognize that the people of San Francisco are in danger of losing faith in our city government. Every few weeks another scandal arises and public confidence sinks to new lows.” A separate paid argument in the voter guide noted above further said: “Proposition K will put teeth into San Francisco’s Ethics laws, ensuring that they are some of the toughest in the country.”

News flash: The people of San Francisco are still in danger or losing faith in our City government after two decades of the Commission’s squalid track record.

As the city prepared to mark national Freedom of Information Day and Sunshine Week, newly released documents reveal that District Attorney George Gascon failed to respond to the city’s Ethics Commission on any referrals for action on violations of the city’s Sunshine Ordinance.

CitiReport publisher Larry Bush had sponsored a $1,000 prize for the best “Open Ethics” application, to help highlight influence trends in the City and relationships between lobbying activity, financial contributions to City leaders, development projects, vendor contracts and legislative actions. However, despite millions in spending on the Ethics Commission and online transparency measures, access to data in these areas is woefully lacking.

The new year begins with yet another proposal by the San Francisco Ethics Commission to repeal a city law intended to thwart the undue influence of money in local elections by placing a cap on the aggregate amount a donor can contribute during an election season.

Under its newest proposal, introduced by Supervisor Scott Wiener on November 22, contributors could write checks totaling tens of thousands of dollars in the upcoming supervisorial contests.

Ethics proposal to eliminate the cap follows a familiar pattern of first failing to enforce the law and then requesting that the law be repealed.

Earlier this year, the Ethics Commission asked that the law be repealed that bans contributions from directors of nonprofit agencies receiving city funding, as well as the law that bans contributions from those with contracts with city agencies like Redevelopment.

Ethics has never enforced the ban and never offered any training to educate the public despite a charter requirement to provide public education.

One way a donor’s promise to make a contribution becomes enforceable is if the promise is in writing and the campaign relies on that expectation of funds by entering into a contract with a vendor. If the promise is not in writing (if the donor merely verbally tells the campaign that they can count on their support), the promise is not enforceable and, therefore, the promise is not a legal contribution that the campaign must disclose to the public. Within that legal architecture is the key to a loophole. If a campaign has reliable donors that it does not want the public to know about, it can get verbal commitments from the donors, rack up debts, and delay disclosure of the donors used to pay the debts until a later date.

It was St. Croix’s decision to reject electronic filing of the contract notifications and continue with paper filing.

As former Ethics Commission filing officer Oliver Luby noted in an online comment, St. Croix’s “complaints about the volume of paper caused by the contract disclosures and the difficulty in cross-referencing them should be viewed with suspicion.”

“While on staff, I recommended not only that cross-referencing of the reports be undertaken but also that the contract report requirement be changed from a paper form to an electronic requirement.

“With zero impact on the agency’s budget, Ethics could replace the paper form with an emailed Excel form, as it has already done with another campaign form.

“Besides saving trees, such a change would allow Ethics and the public to easily set up a database of all the prohibited donors, permitting automation of cross-referencing with contributions.

“Despite such an obvious tech smart option for both facilitating enforcement of the law and providing a compliance tool to campaigns, St. Croix opted to stick with paper.”

First, I had written a November 2005 memo to St. Croix describing the diversion of public funds and stating “there may be serious impropriety present in this case necessitating an investigation as well as perhaps even a referral to the District Attorney’s office due to the possibility of criminal conduct.”

St. Croix ordered me not to speak about my report.

Second, my commentary reported that, following the Chronicle’s exposé of the scandal, St. Croix ceased enforcement of the Major Donor filing requirement, the state disclosure law that allowed me to uncover the money laundering in the first place.

While the Ethics Commission’s acting on Major Donor delinquencies for filing periods from 2000-2004 netted $200,000 in collected penalties and enhanced public disclosure, none of the delinquencies identified by Ethics staff in 2005 or subsequent years were acted upon by Ethics, in violation of state law.

Executive Director John St. Croix complained that Larry Bush had won a change in the Ballot Simplification Committee’s description of the November ballot measure that came from the Ethics Commission.

St. Croix complained that Bush (CitiReport’s Bush, author of this post) had introduced changes that complicated the issue, but also said that the Commission could not speak in favor of its measure now that it is on the ballot.

The change was that the voters are now told that passing the measure means that the Ethics Commission can make any other changes that suit it in future without recourse to the voters.

The Commission sidestepped all factual issues involved in the Run Ed Run effort, including whether there was a factual basis for the claim or the denial that Mayor Ed Lee was in collusion or that the group acted on his behalf.

One commissioner raised the issue that normally the Commission does not undertake such decisions without an investigation of the underlying facts, but that no factual record was presented by the staff.

The Commission also did not suggest that an investigation of the facts surrounding the Run Ed Run campaign be undertaken. At issue is the close relationship between that effort and Lee himself, including the role that such backers as Rose Pak and former mayor Willie Brown played in orchestrating Lee’s initial appointment as interim mayor.

“Second, based on my observations, section 1.126 does not actually address a serious risk of pay-to-play arrangements – or even the appearance of pay-to-play – in State agencies like the Redevelopment Agency or the Health Authority. Although City elective officers appoint some members of those bodies, City officials rarely have any involvement with those agencies’ contracts. Prohibiting the contracting parties from making contributions to City elective officers does not practically serve the City’s anti-corruption goal.”

St. Croix even said “City “City elective officers who appoint members to serve on state agencies usually do not have any influence on, much less have knowledge of, the contracts that the state agency enters.”

Do you believe the mayor had no involvement in the contracts with Treasure Island? Do you believe that members of the Board had no involvement in the contract with Lennar over Hunters Point? Do you believe that the Mayor has no involvement in the contracts at the Housing Authority? Do you believe the Mayor has no involvement in any discussions with the San Francisco 49ners about using Redevelopment land for a stadium?

The San Francisco Civil Grand Jury flunked the city’s Whistleblower program in its latest report on the performance of City Hall in a July 11 release.

“Whistling in the Dark” faulted the city for its failure to protect city worker whistleblowers from retaliation, including being fired from their jobs, for its secrecy that prevents the public from learning the results of investigations, and for wasting its time on complaints that have little merit and are outside the scope of the program. The Civil Grand Jury also noted that oversight of the program is non-existent.

“Nearly eight years after its re-launch under a 2003 charter amendment, the Jury finds that the San Francisco’s Whistleblower Program has failed in its mission to promote the identification of waste, fraud and abuse,” states the 32-page report.

The San Francisco Civil Grand Jury today reported that the San Francisco Ethics Commission is a Sleeping Watchdog that abdicates its responsibilities, has failed to act on all 18 Sunshine violations referred to it for action, and is vulnerable to manipulation in assessing fines against politicians and political groups.

It recommends several corrective actions, including televising Ethics Commission meetings to ensure greater transparency in its deliberations.

The Civil Grand Jury’s findings echo in some respects the concerns about the Ethics Commission voiced during the Board of Supervisor’s Rules Committee consideration of an appointee to the Ethics Commission.

San Francisco is one of five California communities, along with San Diego, Los Angeles, Santa Clara and Oakland, with an ethics oversight commission. The State of California acts on ethics concerns through the Fair Political Practices Commission.

The other commissions, which vary in budget and staff size, have one thing in common: strong enforcement, public disclosure and transparent records, unlike that of San Francisco’s. None have been sued for dereliction of its duties or forced to pay court costs as a result as has San Francisco.

Among the corporations and donors that would be affected by lifting the ban are Lennar, Darius Anderson’s and Ron Burkle’s Treasure Island Enterprises, Forest City, the San Francisco Giants, the San Francisco 49ners and others seeking contracts with the Redevelopment Agency, Treasure Island Development Authority, the Parking Authority, the Housing Authority and a half dozen other agencies.

St. Croix concluded, “For that reason, staff believes allowing parties contracting with those agencies to make contributions to local elected officials poses little or no potential for corruption of the contracting process,” concluded St. Croix.

St. Croix also told Commissioners that he and his staff had never found anyone guilty of violating the contractor ban since the law was passed. Removing the prohibition and the requirements for filing, reviews and reports, St. Croix noted, would reduce the “onerous” Ethics Commission workload.

Instead of acres of green lawn and marble monuments, the city’s most important burial ground takes up just a bank of file drawers located a short half block off Market Street on Van Ness. It is the office of the San Francisco Ethics Commission.

That’s where the complaints of political misdeeds and official misconduct are at eternal rest, peacefully free of the trouble to be found if they existed in jurisdictions outside San Francisco.

Who are the deceased? Some names of the interred:

Pay-to-play appearances at Treasure Island and at the Redevelopment Agency are buried in an unmarked grave.

Using money owed to City College to fund a ballot measure campaign: tag it as an unclaimed body

Former supervisor Ed Jew’s evidence of possible bribery: left in the ambulance and eventually driven off to another location.

Former Mayor Gavin Newsom’s nonprofit Inaugural Committee records raising the issue of money laundering to pay his campaign debts: cremated with the ashes scattered to the winds.

The Department of Public Works contract to SLUG, the nonprofit urban gardening organization, paying for work on Newsom’s 2003 mayoral campaign: the body can’t be located.

Unregistered lobbyists ranging from the Association of Realtors to the Chamber of Commerce to unions and from progressives to Willie Brown and Rose Pak: all unclaimed bodies.

Allegations of rigged bidding on a multi-million dollar Parking Authority contract: in an unmarked grave.

And then there are the unknown dead buried in a mass Potter’s Field because claims it can’t afford the budget to intern them: every whistleblower complaint, every Sunshine Ordinance complaint, every charge of illegal lobbying, every charge of money laundering, every charge of official misconduct in abuse of office, every violation of the ban on contractors contributing to officials who decide on their contracts, every violation of failing to disclose economic interests that the public has a right to know.

However, in addition to that requirement, the Ethics Commission also is mandated in the Charter establishing the Commission to meet a deadline and to provide specific information in its Annual Report that is not required of other city departments.

Most important, the Charter states that in the case of the Ethics Commission, there must be an annual report on the “effectiveness” of the city’s ethics laws on lobbying, campaign finance, conflict of interest, and other ordinances.

It is also required by ordinance to submit independent annual reports each July on the city’s lobbyist ordinance and a separate report each July on the city’s whistleblower ordinance.

For ten years, it has failed to meet any of these three requirements in the Charter and in law.